I came across this question during a test: "Last year I _______ on holiday with a couple of friends"

A. stayed

B. was

I chose B, even though both sentences sounded unnatural to me, because I've never heard anyone say they "stayed on holiday", whereas "to be on holiday" would be a perfectly sound sentence in another context, but A turned out to be the correct answer (if I could have filled the blank with any word, I would have chosen "went"). Is it possible to use "stay" followed by "on holiday/vacation"? What would you have chosen?

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    Stayed is idiomatically fine, though there might be some ambiguity (you might mean you spent your holiday living at the friends' apartment, for example, or that instead of returning from an earlier vacation, you remained at the holiday resort with them). Was is also fine, but in practice most people would use went in most contexts. – FumbleFingers Mar 13 '17 at 14:13
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    Some at our sister site English Language Learners call this Exam English. At first glance, it looks like a question about English, but on closer examination, it bears more resemblance to a 'read my mind' game. During the test, you'd pick whichever you think best fits. When you have time for reflection, though, it can sometimes be an interesting exercise to work out scenarios in which various 'wrong' answers actually make sense, as @FumbleFingers has done. It can be a fun way to explore the language. – Lawrence Mar 13 '17 at 14:21
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    This is such a poor exam question that you might like to point out these Google Ngrams to someone. // 'I stayed with a couple of friends on holiday last year' sounds far more likely than 'Last year I stayed on holiday with a couple of friends' to my (British) ear. – Edwin Ashworth Mar 13 '17 at 16:52
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    Is this example supposed to be British English? – Jasper Mar 13 '17 at 20:27

I'm non-native speaker but both sound okay to me, however, "was" and "went" sound more common.

Dictionaries tell us that "stay" can mean "(of a person) live somewhere temporarily as a visitor or guest." so the first sentence "Last year I stayed on holiday with a couple of friends" may well mean that you lived somewhere for some time with a couple of friends.

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